Bill Fleckenstein Hanging It Up
Well-known short seller Bill Fleckenstein is hanging it up and shutting down his short-focused hedge fund. Here is the story from Hedgefund.net:
Manager burnout is in. Andrew Lahde started the trend. Now Bill Fleckenstein is telling people that stress factored large in his decision to close his hedge fund. Fleckenstein called running a short only hedge fund "Very stressful, nerve-wracking and generally not very much fun," on his Web site.
Fleckenstein launched the short only fund in 1996 when "[then-Federal Reserve Bank Chairman Alan] Greenspan was fomenting an environment that would lead to disaster." The "reckless behavior" driving the stock market "lasted much, much longer than I ever imagined it could," prompting Fleckenstein to keep the fund open for over a decade and reap profit.
But now, the "recent carnage" has diminished shorting opportunity, he wrote. His weary tone recalled Andrew Lahde, another short bias hedge fund manager whose bet against subprime mortgage earned him close to 1,000%. Lahde in a much publicized letter announcing the closure of his hedge fund bemoaned the toll the job had taken on his health.
But unlike Lahde, who emphasized he had no inclination to return to investing, Fleckenstein enthused about a plan to open a long only investment fund. While running a short only hedge fund "entailed an intense focus on the short term to effect risk control" a long only portfolio would help "widen" his focus, he wrote.
"My wife is especially happy about this change," he wrote.